Tag Archives: China

Australia: The Prize No One Talks About

Posted on by
Reply

There’s a story playing out on the world stage that barely makes a ripple in most media cycles. While the headlines fixate on Ukraine, Gaza, or Taiwan, an unspoken contest is quietly unfolding for influence over a country that has, for too long, been treated as a polite and distant cousin in global affairs: Australia.

We’re used to thinking of the United States as having eyes on Canada, economically, culturally, and strategically. The integration is old news: NORAD, pipelines, the world’s longest undefended border, and the quiet assumptions of shared destiny. But if you really want to understand the next chapter of global power politics, don’t look north. Look west. Look south. Look to Australia.

What’s emerging now is not a scramble for land or flags, but for strategic intimacy, a deep intertwining of interests, logistics, defense capabilities, and ideological alignment. Australia is the prize not because it’s weak, but because it’s vital: geographically, economically, and politically.

The American Pivot
The United States is already entrenched. Through AUKUS, it has committed to helping Australia build nuclear-powered submarines and integrate into the U.S. military-industrial supply chain. But this is more than just a defense pact. It’s about locking Australia into a security and technology architecture that positions it as a forward base for U.S. naval and cyber operations, a southern anchor against Chinese ambitions in the Indo-Pacific.

What few people understand is this: Australia is becoming America’s new front line. Not in the sense of war, but in the grand strategy of containment, deterrence, and projection. The U.S. doesn’t want Australia as a vassal, it wants it as a platform, a co-pilot, a bulwark. In many ways, it’s happening already.

India Enters the Frame
But Washington isn’t the only capital watching Canberra. New Delhi is quietly but deliberately courting Australia too, not for bases, but for bonds.

India sees Australia through a different lens: not as a strategic outpost, but as an extension of its civilizational, economic, and diasporic reach. With a large and growing Indian community in Australia, rising trade links, and joint naval exercises in the Indian Ocean, India’s interest is long-term and layered.

What India understands, and what many in the West overlook, is that Australia is a natural expansion point for a rising democratic Asia. It’s a source of energy, food, space, and credibility. In a world where climate instability and resource scarcity are redefining security, having Australia in your corner isn’t optional. It’s essential.

Why It Matters
This isn’t a turf war. It’s not a return to Cold War blocs. It’s more fluid than that, a web of influence where infrastructure, education, culture, and soft power matter just as much as tanks and treaties.

The real story is this: Australia is shifting from the periphery to the center of global strategic thought. It’s no longer just “down under.” It’s at the crossroads of the world’s most dynamic (and dangerous) geopolitical contest: the one unfolding across the Indo-Pacific.

And here’s the kicker: Australians are waking up to this. The era of benign non-alignment is over. The decisions they make in the next decade, about alliances, sovereignty, and identity — will echo far beyond their shores.

So the next time someone tells you it’s all about Europe or the South China Sea, remind them: The most consequential strategic competition of the 21st century might just be quietly unfolding in the sunburnt country; and it’s not just China who’s watching. The U.S. and India are, too. And they both want Australia in their future.

North America’s Strategic Choice: Integration or Irrelevance in a Multipolar World

Posted on by
Reply

As the global trade landscape shifts, alliances such as BRICS and infrastructure developments like the International North-South Transport Corridor (INSTC) are redrawing the map of commerce. These projects are not just economic arrangements, they are strategic assertions of a multipolar world, where emerging economies are building financial systems and trade networks that bypass traditional Western-dominated institutions. In this changing environment, deeper integration across North America is no longer just desirable, it is essential. The United States, Canada, and Mexico share geography, economic interdependence, and complementary strengths. But instead of leaning into this partnership, the U.S. has at times acted in ways that undermine its closest allies, and in doing so, it is undercutting its own long-term strategic interests.

BRICS, now expanded to include nations like Egypt and the UAE, is working toward reducing reliance on the U.S. dollar and building alternative financial infrastructure. Simultaneously, the INSTC, a 7,200-kilometre multimodal corridor linking India, Iran, Russia, and Europe, offers a faster and cheaper trade route than the Suez Canal. These shifts are enabling new alignments between Asian, Eurasian, and Global South nations. In contrast, the U.S. risks being left behind unless it reinvests in its regional relationships. North America, bound by the Canada-United States-Mexico Agreement (CUSMA), already possesses a solid legal and regulatory foundation. What is missing is the political will to push that foundation into a fully integrated economic zone.

Closer North American integration could strengthen supply chains, enhance competitiveness, and boost regional innovation. Mexico’s manufacturing power, Canada’s resource wealth and technological expertise, and the U.S.’s financial and consumer might together could create a resilient and globally influential economic bloc. However, protectionist impulses from Washington, such as tariffs on Canadian aluminum, trade disputes over softwood lumber, and threats against Mexican imports, erode trust. These actions push Canada and Mexico to expand trade elsewhere, increasing their engagement with China, the EU, and the Asia-Pacific. While diversification is strategically wise, a fragmented North America plays directly into the hands of BRICS and INSTC-aligned actors.

Still, for Canada and Mexico, investing further in North American integration remains the most strategically sound choice. Despite political turbulence, the U.S. offers unmatched access to capital, consumer markets, and legal protections. CUSMA provides a rules-based framework that supports long-term stability more effectively than newer or looser trade deals. And while deeper trade ties with China or Europe may offer short-term gains, they cannot replicate the geographic, cultural, and logistical synergies of the North American relationship. Rather than turning outward in frustration, Canada and Mexico can use their economic leverage to influence U.S. trade policy from within, helping to shape a trilateral vision rooted in shared democratic values and mutual prosperity.

The U.S., for its part, must recognize that its global position depends not just on military strength or Silicon Valley innovation, but on the strength of its closest partnerships. The path forward lies not in undermining allies, but in building with them a regional powerhouse capable of competing with the rising multipolar world. Failing to do so means ceding both economic and geopolitical ground – to rivals who are already moving with speed and purpose.

🛡️ NATO & Allied Countries Shifting Away from U.S. Defense Equipment

Posted on by
Reply

Several NATO and allied countries have recently rejected or are reconsidering U.S.-made military equipment in favor of European or domestic alternatives. This trend reflects a broader shift toward defense autonomy, industrial sovereignty, and reduced reliance on U.S. service contracts.

🇩🇰 Denmark

  • Air Defense: Opted for the Franco-Italian SAMP/T NG long-range system over the U.S.-made Patriot missile system, citing high costs and long delivery times. Denmark is also considering European alternatives like NASAMS, IRIS-T, and VL MICA for medium-range needs.
  • Arctic Exercises: Led the “Arctic Light 2025” military exercise in Greenland without U.S. participation, emphasizing regional leadership and reducing reliance on U.S. forces.

🇪🇸 Spain

  • Fighter Aircraft: Rejected U.S. F-35 proposals in favor of European options like the Eurofighter Typhoon and the Future Combat Air System (FCAS), aiming to bolster European defense autonomy and reduce dependence on U.S. military technology.

🇵🇹 Portugal

  • Fighter Aircraft: Reconsidered plans to replace aging F-16s with U.S.-made F-35s, exploring European alternatives to enhance operational control and reduce long-term dependency on foreign suppliers.

🇩🇪 Germany

  • Air Defense: Prioritized domestic production and local sustainment for tanks, artillery, and aircraft, including the Leopard 2 tank upgrades and Eurofighter Typhoon programs, to maintain control over maintenance and modernization capacities.

🇳🇱 Netherlands

  • Naval Platforms: Emphasized European suppliers for submarines and frigates, negotiating co-production and local sustainment agreements to reduce reliance on U.S. shipyards.

🇳🇴 Norway

  • Fighter Jets & Patrol Aircraft: Pushed for domestic assembly lines and local maintenance hubs, limiting dependence on American contractors for lifecycle support.

🇮🇹 Italy

  • Naval & Aerospace Systems: Invested in domestic shipbuilding and aerospace industries, including the FREMM frigate and domestic drone programs, while seeking interoperability standards that avoid long-term U.S. service dependencies.

🇨🇦 Canada

  • Submarine Procurement: Rejected U.S. proposals for new submarines, opting instead for bids from Germany and South Korea to gain autonomy over maintenance, lifecycle upgrades, and operational decision-making.
  • Fighter Aircraft: Evaluating Swedish fighter jets with plans for domestic assembly and maintenance, aiming to reduce reliance on U.S. contractors.

🇫🇮 Finland

  • Military Cooperation: Despite broader U.S. plans to scale back military operations in parts of NATO’s eastern flank, Finland maintains that its military cooperation with the United States is not being reduced. Finnish Defence Minister Antti Hakkanen affirmed that the U.S. remains committed to deepening bilateral defense efforts.

🇫🇷 France & 🇮🇹 Italy

  • NATO Arms Deal: Opted out of a new NATO-led initiative to finance the delivery of U.S. weapons to Ukraine, signaling a preference for European solutions and a move towards greater defense autonomy.

🔄 Broader Trends Influencing These Shifts

  • Cost & Delivery Timelines: U.S. defense systems like the Patriot missile system often face long production backlogs and higher costs, prompting NATO allies to seek more timely and cost-effective European alternatives.
  • Industrial Sovereignty: Countries are increasingly prioritizing local or regional production and maintenance capabilities to maintain control over their military assets and reduce dependence on foreign suppliers.
  • Political Tensions: Diplomatic strains, such as disagreements over Arctic territories and defense spending, have influenced countries like Denmark to reconsider their reliance on U.S. defense equipment.
  • Strategic Autonomy: The desire for greater control over defense decisions and capabilities is driving NATO allies to explore European solutions that align with their national interests and security priorities.

Allies Reclaiming Autonomy: The Growing Shift Away from U.S.-Made Military Equipment

Posted on by
Reply

Across NATO and allied nations, governments are increasingly rejecting U.S. defense options or cancelling long-term contracts, favoring domestic or European alternatives that offer control over manufacturing, maintenance, and upgrades.

For decades, the United States has dominated the global defense market, especially among NATO allies. Its model, sell advanced platforms, then tie buyers into decades of maintenance, upgrades, and proprietary service, has been remarkably profitable and politically influential. But that model is under pressure. Increasingly, U.S. allies are saying no: rejecting American options, cancelling planned contracts, or shifting to alternatives that offer greater operational and industrial autonomy.

Spain provides a recent example. While the country had previously considered U.S.-made platforms to modernize its air force, Madrid has turned toward European options such as the Eurofighter Typhoon and the Future Combat Air System. Officials cited cost, supply chain control, and the desire to retain domestic and European industrial participation as key drivers. Similar reasoning is guiding Portugal, which has reconsidered its replacement programs for aging aircraft, leaning toward European-built fighters rather than committing to U.S.-supplied F-35s.

Denmark illustrates the trend in air defense. In its largest-ever defense procurement, the Danish government opted for the Franco-Italian SAMP-T NG long-range system over the U.S.-made Patriot, citing both cost and delivery time. Denmark is also reviewing medium-range options from European manufacturers, emphasizing local or regional production and maintenance. This choice reflects the dual desire to strengthen European defense capabilities while reducing reliance on U.S.-based service contracts.

Other NATO members are making comparable moves. Switzerland, historically neutral, has expressed reservations about joining long-term U.S. programs, including the F-35, instead evaluating European alternatives that allow for national control over lifecycle management. Norway has similarly emphasized local assembly and domestic sustainment for fighter and patrol aircraft. The Netherlands, Belgium, and Greece have all shown interest in European or domestic solutions for naval, air, and missile systems, explicitly seeking contracts that do not lock them into decades-long U.S. maintenance agreements.

These choices reflect a broader strategic and economic calculation. U.S.-made systems, while technologically advanced, often require buyers to accept a near-perpetual dependency on American contractors for upgrades, parts, and service. Allies are increasingly reluctant to cede that control, recognizing that operational autonomy and local industrial development are critical to national security. European manufacturers, by contrast, are offering co-production, local assembly, and technology transfer that allow countries to maintain both sovereignty and economic benefit from defense programs.

The implications for the U.S. defense industry are substantial. Losing planned contracts or having allies cancel or decline U.S.-made systems threatens billions in revenue, particularly from the lucrative long-term service and maintenance components. Strategically, it reduces Washington’s leverage: allies that control their own equipment are less subject to subtle influence through supply and upgrade dependencies. Over time, the cumulative effect could reshape the defense-industrial landscape in Europe and beyond, challenging the assumption that U.S.-supplied hardware will dominate allied inventories.

Canada, with its submarine program and proposed Swedish fighter deal, stands as the most prominent example, but it is hardly alone. Across Europe and NATO, governments are asking whether reliance on U.S. contractors for decades-long service agreements is compatible with modern defense priorities. The answer increasingly appears to be “no.” Allies want control over manufacturing, maintenance, and upgrades, and they are willing to bypass traditional U.S. options to achieve it.

In short, the U.S. model of “buy once, pay forever” is losing favor. NATO members and other allies are embracing autonomy, local industrial participation, and diversified procurement, signaling a shift that could reverberate across global defense markets for decades. The message is clear: even America’s closest partners are no longer content to surrender operational control and economic benefit for decades-long contracts that primarily serve U.S. industry.

Canada and Mexico Forge Strategic Partnership: Implications for North America

Posted on by
Reply

On September 18, 2025, Canadian Prime Minister Mark Carney and Mexican President Claudia Sheinbaum signed a comprehensive strategic partnership in Mexico City. This agreement, covering 2025–2028, aims to deepen economic, security, and environmental collaboration between Canada and Mexico, explicitly anticipating the 2026 review of the United States-Mexico-Canada Agreement (USMCA). While the immediate bilateral effects are evident, the agreement also carries broader implications for the three major North American economies: Canada, Mexico, and the United States.

Scope and Focus of the Agreement
At its core, the agreement establishes a four-year bilateral action plan encompassing four pillars: prosperity, mobility and social inclusion, security, and environmental sustainability. Economically, it focuses on expanding trade and investment in infrastructure, energy, agriculture, and health, while jointly developing critical infrastructure such as ports, rail links, and energy corridors. In security, it aims to strengthen border control and combat transnational crime. The environmental and sustainability component is particularly notable, signaling both countries’ intent to collaborate on climate mitigation and resource management.

Strategic Context
The timing of this agreement is significant. Earlier in 2025, both Canada and Mexico faced tariffs and trade frictions with the United States, creating a strategic impetus to solidify bilateral cooperation. This partnership may serve as a hedge against future unilateral U.S. trade measures and positions both nations more strongly for upcoming negotiations surrounding the USMCA review in 2026. By consolidating economic, security, and environmental frameworks bilaterally, Canada and Mexico signal that they can act decisively and collaboratively independent of U.S. alignment, while still committing to trilateral engagement.

Implications for Canada
For Canada, the agreement represents a proactive diversification of trade and investment partnerships within North America. Beyond the U.S., Mexico is an increasingly significant market for Canadian goods and services, particularly in energy and infrastructure. By reinforcing bilateral economic ties, Canada gains leverage in upcoming USMCA discussions and reduces its vulnerability to unilateral U.S. trade policy shifts. Moreover, collaboration on climate and sustainability initiatives positions Canada as a leader in cross-border environmental governance, complementing its domestic commitments.

Implications for Mexico
For Mexico, the agreement strengthens its economic and geopolitical options. Mexico has historically balanced trade and diplomatic relationships with the United States while seeking alternative partners. Formalizing a strategic partnership with Canada enhances Mexico’s negotiating position with the U.S., particularly as the USMCA review approaches. Joint infrastructure projects and investment commitments also promise to accelerate Mexico’s industrial and energy development, potentially boosting domestic employment and technology transfer.

Implications for the United States
For the United States, the Canada-Mexico agreement presents both opportunities and challenges. On one hand, stronger integration between Canada and Mexico may facilitate smoother trilateral cooperation, reducing friction in cross-border commerce and security. On the other hand, it could limit U.S. leverage in bilateral negotiations with either country if Canada and Mexico present unified positions during the USMCA review. The U.S. may need to consider the strategic consequences of any unilateral trade actions in light of this growing North American solidarity.

The Canada-Mexico strategic partnership represents a calculated, forward-looking approach to regional stability and prosperity. While the agreement strengthens bilateral ties, it also reshapes the dynamics of North American relations, providing both Canada and Mexico with enhanced economic and strategic agency. For the United States, it signals a more integrated northern and southern neighbor bloc, emphasizing the importance of collaborative rather than confrontational engagement. As the 2026 USMCA review approaches, all three nations will likely navigate a more complex and interdependent landscape, where trilateral cooperation becomes not only beneficial but essential.

Sources:
• Reuters. Canada and Mexico committed to shared partnership with US, Carney says. September 18, 2025. link
• Politico. Mexico and Canada make nice ahead of high-stakes trade talks. September 18, 2025. link
• Global News. Carney, Sheinbaum sign strategic partnership to boost trade, security, environment. September 18, 2025. link

AUKUS Update: Trump’s Price Hike and the Shadow of a Sovereignty Clause

Posted on by
Reply

This post is an update on the AUKUS saga that I wrote about, back in May 2025. Do you think the Australians are wishing they had stuck with their agreement with the French? 

AUKUS: Australia’s Submarine Mirage and the Real Estate Windfall for the US and UK

As the ink dries on Australia’s multi-decade submarine commitment under the AUKUS pact, new political winds out of Washington are shaking the foundations of what Canberra once saw as a strategic guarantee. Under the returning Trump administration, the U.S. is pushing to renegotiate the financial terms of the agreement and is reportedly seeking to insert a wartime control clause, raising fresh concerns about Australia’s sovereignty and strategic independence.

The heart of the issue is money. While Australia has already pledged over US$500 million to help expand U.S. submarine production capacity, Trump’s team is now demanding far more, up to US$2 billion in new payments, as a condition to secure delivery of three to five U.S. Virginia-class nuclear submarines from 2032 onward. These funds would be directed to bolster American shipyards, particularly in Virginia and Connecticut, which remain overextended and under pressure to deliver on U.S. Navy contracts.

The financial squeeze isn’t the only concern. Reports have surfaced in The Australian and News.com.au that a so-called “China clause” may be under quiet negotiation. This clause would give the U.S. the right to reclaim or restrict Australian use of the submarines during a major conflict, particularly one involving China. While the Pentagon has not confirmed the existence of such a clause, the possibility alone has ignited alarm among Australian defense experts and former leaders.

Former Prime Minister Malcolm Turnbull, an early critic of the AUKUS pact, warned that the submarine deal risks becoming a one-sided arrangement in which Australia pays heavily to host, maintain, and eventually crew American subs, without ever holding true operational control. Bob Carr, another former senior figure, was blunter: if the clause is real, it would render Australia’s billion-dollar fleet a “rental service” for U.S. war planners.

Current officials, including Defence Minister Richard Marles, have sought to play down the growing controversy. He insists the U.S. review is “routine” and that Australia remains committed to the AUKUS vision. But behind closed doors, pressure is mounting. Canberra must now decide whether to comply with the new financial demands and legal caveats—or begin preparing for a prolonged diplomatic standoff.

Meanwhile, in the U.S. and U.K., the shipyards and surrounding real estate markets continue to benefit from AUKUS-linked investments. The U.S. gains not only geopolitical leverage but a quiet economic windfall, as the influx of Australian capital fuels job creation and property demand in key production zones like Newport News, Virginia and Barrow-in-Furness in the UK.

What began as a trilateral alliance of equals now looks increasingly like a bargain between a landlord and tenant, with Australia footing the bill for the privilege of being an American ally. As the strategic calculations shift and Trump’s transactional style returns to the global stage, Australia’s AUKUS submarines may be powerful, but only if Canberra retains the keys.

Sources:
• News.com.au
• The Guardian
• The Washington Post
• The Australian
• Economic Times

Five Things We Learned This Week

Posted on by
Reply

Here’s the latest edition of “Five Things We Learned This Week” for July 5–11, 2025, featuring all-new insights within the past seven days—no repeats from previous lists:

⚖️ 1. Trump Intensifies Trade War with 30–50% Tariffs

  • Between July 7–11, President Trump sent letters threatening 30% tariffs on EU & Mexico (starting Aug 1), 35% on Canada, and 50% on imported copper, along with an extra 10% on BRICS allies  .
  • Global markets responded with caution—stocks dipped, safe-haven assets steadied, and commodity currencies showed volatility  .
  • Trade partners expressed strong concern, calling the moves disruptive amid ongoing negotiations  .

🛢️ 2. Oil Prices Jump Over 2% amid Tight Markets and Tariff Fears

  • On July 11, Brent rose ~2.5% ($1.72/barrel) to $70.36, and WTI climbed 2.8% to $68.45, sparked by IEA warnings of tighter supply, OPEC+ compliance, and trade policy risks  .
  • U.S. rig counts fell for the 11th straight week, intensifying concerns about future output ().

🌍 3. UN Adopts Climate–Human Rights Resolution

  • On July 8, the UN Human Rights Council passed a climate change motion that ties environmental harm to human rights—adopted by consensus after the Marshall Islands withdrew a controversial fossil-fuel phase-out amendment  .
  • The resolution calls for “defossilizing our economies” and sets a benchmark for framing climate action as a global human-rights priority  .

💼 4. BRICS Summit Highlights Climate Funding Demands

  • On July 7, at their Rio meeting, BRICS leaders urged wealthy nations to fund climate transitions in developing countries, while also affirming continued fossil fuel usage in their economies  .
  • Brazil’s President Lula warned against denialism, contrasting BRICS multilateralism with U.S. isolationism ().

🎤 5. Reuters NEXT Asia Summit Tackles Trade, AI & Global Stability

  • July 7, the Reuters NEXT Asia forum in Singapore convened ~350 global leaders to debate pressing issues—covering AI innovation, trade disputes, and geopolitical uncertainty  .
  • Discussions stressed AI’s dual potential for disruption and opportunity, with trade tensions—especially tariffs—looming large.

Each of these five highlights occurred between July 5–11, 2025, and brings fresh, global perspectives to this week’s roundup. Want full article links or deeper analysis? Just say the word!

The BRICS Strategy in 2025: From Dialogue to Direction

Posted on by
Reply

In July 2025, the BRICS nations – Brazil, Russia, India, China, South Africa, and an expanded circle now including Egypt, Ethiopia, Iran, Saudi Arabia, the UAE, and Indonesia, met in Rio de Janeiro for their 17th annual summit. The gathering marked a decisive shift from rhetorical ambition to institutional strategy, as the bloc attempts to redefine global governance, build financial alternatives to the West-led systems, and frame itself as the political voice of the Global South. While the summit was shaped by ongoing geopolitical crises and internal contradictions, it revealed a maturing vision that extends far beyond its original economic coordination mandate.

At the core of this year’s summit was a demand for structural reform in global governance. BRICS leaders called for the United Nations Security Council to be expanded and for the voting structure of institutions such as the International Monetary Fund (IMF) and World Bank to be reweighted to better reflect the global South’s demographic and economic realities. This long-standing frustration with Western-dominated institutions has now sharpened into a diplomatic agenda. What was once a diffuse critique has evolved into coordinated proposals, particularly on the economic front.

One of the summit’s central themes was the steady progress toward de-dollarization. While calls for a BRICS common currency were conspicuously downplayed in Rio, leaders focused instead on more pragmatic steps: local-currency trade settlements, expanded use of central bank digital currencies (CBDCs), and the interoperability of national payment systems through the still-developing BRICS Pay infrastructure. A new cross-border clearing and settlement framework, informally called BRICS CLEAR, was introduced to complement these efforts. These initiatives are designed not only to bypass the U.S. dollar in bilateral and multilateral trade, but also to shield BRICS economies from the volatility and political conditionality associated with Western sanctions and SWIFT-based systems.

To support these ambitions, the New Development Bank (NDB), already capitalized with billions of dollars from member states, is being repurposed. A guarantee facility is in development, modeled loosely on the World Bank’s Multilateral Investment Guarantee Agency (MIGA), to underwrite public and private projects across member states. This is particularly relevant for emerging markets seeking infrastructure finance without the governance conditions typically imposed by the IMF or World Bank. With these tools, the bloc seeks to develop its own version of Bretton Woods-style architecture, updated for multipolar geopolitics.

Climate and sustainability also featured heavily on the summit agenda. Brazil, as host, proposed the “Tropical Forest Forever Facility,” a $125 billion climate financing mechanism aimed at conserving rainforest regions across Latin America, Africa, and Asia. The proposal is a direct challenge to Western narratives that have often placed environmental responsibility solely on the shoulders of developing nations without matching financial commitments. The initiative also serves as a preview of the Global South’s priorities heading into COP30, which will also be hosted by Brazil.

Sustainable development received structural attention beyond climate. The BRICS Business Council and Women’s Business Alliance jointly launched a 2025–2030 action plan focused on strengthening small and medium-sized enterprises (SMEs) across member states. This includes access to digital markets, cross-border licensing, and gender-equity strategies in entrepreneurship. The bloc appears intent on grounding its geopolitical ambitions in concrete developmental outcomes at the community and enterprise level.

Notably, the summit also launched a framework for artificial intelligence governance. Although still in early stages, the agreement seeks to establish common principles around transparency, ethical use, and protection against algorithmic bias. This aligns with recent UN discussions and serves to position BRICS as a rule-setting body rather than just a rule-taking coalition. With China and India both advancing in AI development, and with Brazil and South Africa playing increasing roles in data regulation, this initiative represents an important test of cross-ideological cooperation in technology governance.

Despite these achievements, internal tensions were evident. Neither President Xi Jinping nor President Vladimir Putin attended in person. India’s leadership walked a diplomatic tightrope, supporting reformist language while resisting deeper integration that might conflict with its ties to the West. Brazil, under President Lula, tempered the bloc’s anti-Western tone, particularly around tariffs and NATO criticism, wary of provoking trade retaliation. These divergences underscore the coalition’s central contradiction: it is an alliance of ambition, not ideology.

Nonetheless, BRICS continues to expand. Indonesia became a full member in January 2025, joining Iran, Egypt, Ethiopia, and others admitted in the prior year. Observers note that the group’s size risks diminishing its coherence, yet the appeal of a multipolar forum remains strong. As the G7 struggles with internal disunity and the Western alliance faces political upheaval, BRICS offers a platform that aligns with the aspirations of many developing nations, even if it cannot yet match Western institutions in capacity or cohesion.

Looking ahead, the bloc’s short-term focus will be on operationalizing its financial and development tools, settlement systems, climate funds, SME supports, and asserting diplomatic pressure for reform in global governance bodies. Over the medium term, its success will depend on the extent to which it can balance economic pragmatism with political heterogeneity. While its vision of a multipolar world is not universally embraced, BRICS has matured into a serious force in global affairs, one increasingly capable of setting its own agenda.

Five Things We Learned This Week

Posted on by
Reply

Here’s the latest edition of “Five Things We Learned This Week” for June 28–July 4, 2025, showcasing five entirely new global developments—each occurring in the past seven days:

⸻

🧭 1. Trump Signs Sweeping Tax & Spending Bill

• On July 4, President Trump signed a landmark tax-and-spending package into law, following its narrow passage in Congress  .

• This $3.3 trillion bill includes large tax cuts and federal spending boosts, with analysts warning of significant long-term increases in national debt  .

⸻

🌍 2. Japan Warms for Possible Quakes, Authorities Calm Public

• On July 4, Japan’s disaster agency alerted residents of potential strong aftershocks off the southwest coast, though downplaying doomsday fears  .

• Authorities emphasized preparedness over panic, urging early warning systems remain active.

⸻

🇨🇳 3. China Signals Investment in Brazil‑Led Forest Fund

• At the end of the week, Reuters reported that China plans to back the “Tropical Forests Forever” fund led by Brazil—marking a strategic shift toward joint environmental efforts  .

• This move is viewed as a rare diplomatic gesture amid global climate partnerships.

⸻

📈 4. Global Equity Funds See Largest Inflows in 8 Months

• Global equity funds recorded a massive $43.15 billion inflow for the week ending July 2, driven by U.S. stock highs and surging interest in AI and tech sectors  .

• U.S. equity funds accounted for $31.6 billion, with robust gains also seen in European and Asian markets  .

⸻

🇲🇩 5. Moldova Leaders Emphasize EU Integration Ahead of Election

• On July 4, Moldova’s President Maia Sandu declared that citizens hold the future of the EU bid in their own hands as the country nears parliamentary elections  .

• Her appeal underscores Moldova’s ongoing push for formal European Union membership.

⸻

These five developments span U.S. fiscal policy, earthquake readiness, international environmental funding, global investment trends, and Eastern European geopolitics—all fresh this week. Want source links or deeper insights? Let me know!

Why Canada’s Digital Services Tax Is Poking the Bear – And Why Australia and New Zealand Are Still Holding the Stick

Posted on by
Reply

It was only a matter of time before Canada threw its toque into the ring on the global debate over taxing tech giants. After years of polite patience, Ottawa finally said enough is enough and committed to implementing a Digital Services Tax (DST), retroactively, no less, dating back to January 1, 2022. The goal? To make Big Tech pay its fair share for the billions they earn from Canadians’ online clicks, swipes, and searches. Predictably, this move hasn’t exactly gone down well south of the border, especially with Donald Trump, who’s already threatening retaliatory tariffs faster than you can say “Google it.”

Canada’s DST is a 3% levy on revenues from digital services; think online marketplaces, advertising platforms, and social media, that target Canadian users. The tax only kicks in for companies making over €750 million globally and more than $20 million in Canadian digital revenues. So, yes, this is about Amazon, Google, Meta, and Apple. Not your cousin’s Shopify side hustle.

The reasoning behind the move is, frankly, hard to argue with. For years, digital multinationals have made huge profits in countries where they have lots of users but no physical offices. Since our tax codes were written in the days of rotary phones, these companies have legally side-stepped corporate taxes in places like Canada while hoovering up data and ad dollars with industrial-grade efficiency. The DST is intended as a band-aid solution until a global fix comes together, though that band-aid is now being applied with an increasingly firm hand.

In truth, the global tide may finally be turning on Silicon Valley’s long, tax-free world tour. For over a decade, Big Tech has surfed a wave of international growth, scaling into nearly every market on Earth without paying local dues. Armed with sophisticated tax avoidance schemes, usually routed through Ireland or the Netherlands, the giants of the digital economy have profited handsomely while governments watched domestic retailers struggle to compete. But now, faced with growing public backlash and creaking public coffers, countries from France to India to Canada are drawing a line. The message is clear: if you make money off our citizens, you’re going to help fund the roads, schools, and social programs that keep them clicking.

The global fix in question is the OECD’s “Two-Pillar” solution, a diplomatic marathon attempting to modernize international tax rules. Pillar One aims to reallocate taxing rights to market countries (like Canada), while Pillar Two would establish a global minimum corporate tax of 15%. Canada has said it would delay DST collection if the OECD deal is implemented, but with the U.S. dragging its heels on ratification, Ottawa is preparing to go it alone.

That’s where Trump comes in. Never one to let a perceived slight slide, he’s treating Canada’s DST as a direct assault on U.S. interests. After all, the companies getting dinged are almost entirely American. Trump’s threats to slap retaliatory tariffs on Canadian exports are classic “America First” bluster, but they’re not without precedent. The U.S. already opened Section 301 investigations into several other countries’ DSTs, accusing them of unfairly targeting American firms. Biden’s administration cooled the rhetoric, but the sentiment remains.

Of course, Canada isn’t the only country to stick its neck out on this. France was the pioneer, pushing ahead with a 3% DST despite fierce U.S. pushback. Italy, Spain, and the UK followed suit. Even India got into the act with its “equalisation levy,” predating many Western attempts. Each of these nations, like Canada, grew tired of waiting for multilateral action while Silicon Valley giants dodged their tax nets with Olympic-level agility.

Interestingly, not everyone in the Anglosphere has been quite so bold. Take Australia. A few years back, it flirted with a DST, there were consultations, white papers, and worried glances toward Washington. But ultimately, Canberra decided to give the OECD process a shot and beefed up its anti-avoidance laws instead. Its Multinational Anti-Avoidance Law and Diverted Profits Tax now let the tax office go after digital firms that try to shuffle profits offshore. It’s the equivalent of hiring a tough new accountant rather than inventing a new tax altogether.

New Zealand, meanwhile, has taken a “just in case” approach. Legislation for a 3% DST was passed in 2023, but it’s sitting in a drawer for now, ready to go if the OECD talks collapse. The Kiwis have been clear they don’t want to pull the trigger unless absolutely necessary, probably because they’d prefer not to find themselves on the receiving end of a tweetstorm or tariff tantrum from the next American administration.

So here we are: Canada, gloves off and calculator in hand, is forging ahead, determined to claw back a fair share from the tech titans. Australia and New Zealand, pragmatic as ever, are hedging their bets and keeping trade relationships intact, at least for now. But even their patience has limits. The longer the OECD deal stalls, the more tempting it becomes to follow Canada’s lead.

In the end, this is a fight not about code or commerce, but about fairness in the digital age. The world’s tax systems were built for an era of railroads and oil refineries, not cloud storage and influencer revenue. Until the global rules catch up, expect more countries to test their own digital tax solutions. Whether that means poking the American bear or just poking around in policy drawers remains to be seen. But one thing’s certain: tech giants might finally be running out of places to hide.